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Wednesday, September 21, 2011

Only half of Philippine land parcels titled

Apparently, our land registration system is more horrible than I imagined. I am told that only about half of the estimated 22 million land parcels in this country are titled. Much of the rest are only covered by land patents or at worse, only by property tax declarations which are not acceptable as bank collaterals for loans.

This situation is why, some economists have pointed out, our countryside is unable to benefit from the formal banking system. In a sense, there is so much wealth trapped because the land they inherited or own cannot be leveraged to produce more wealth or as capital in a business.

Not surprisingly, there is already a law that is supposed to address that problem, the Residential Free Patent Law (RA 10023) passed some years ago. The previous judicial free patent route was costly, protracted, and complex. This new law gives a faster administrative option to free patent.

According to Calixto Chikiamco, president of the Foundation for Economic Freedom (FEF), this law is about formalizing the land ownership of many residential lot owners and homeowners who only have tax declarations as proof of ownership. The purpose of the law is to “unlock dead capital” by giving formal titles to the occupants.

This law was supported by the Chamber of Thrift Banks and the Rural Bankers Association. They have been complaining about a lack of supply of titles as collateral for lending and this of course, limits their ability to grant loans and make the rural banking industry more viable.

But as with all the good intentions behind laws passed by Congress, the problem was the implementation. DENR, the agency with authority over land patents, does not have the manpower and the resources to really implement the law. Local governments on the other hand, do not have the trained manpower or the organization to do it too. Before RA 10023, the number of judicial free patents issued every year was 1,000. So it would have taken more than 6,000 years to finish the backlog.

This is how the FEF ended up doing more than expressing its collective opinion on an economic issue. If talk is cheap, getting their hands dirty in the field takes resources. With the help of the US Agency for International Development and the Asia Foundation the FEF launched a program to help in the implementation, primarily by developing the concept of LGU-led land titling.

The joint program is called “Property Rights for Economic Progress,” and technical assistance and training are now being provided to interested LGUs leading to the establishment of land offices for the implementation of the Residential Free Patent Act. In other words, the program seeks to have DENR empower LGUs (with DENR’s supervision and cooperation, of course) to implement the RFP law and move faster to erase the huge backlog of about 6 to 7 million untitled residential lands.

Chikiamco explained FEF’s involvement saying that the law will hopefully spur entrepreneurial activity through the buying and selling of lands and would give more opportunities for title holders to credit facilities of banks and other financial institutions using their land titles as collateral for loans.

“Our vision is that each LGU will have Land or Cadastral Offices which shall have complete land information using technologies like GPS and geo-tagging not only for tax purposes, but also for governance, such as crime prevention, public health, disaster management, etc. In Cebu, for example, their Land Office tracks the outbreak of dengue using these land information maps,” Chikiamco explained.

FEF started the program last year by choosing pilot areas and then develop a toolkit that can be rolled out to other LGUs. In Metro Manila, it seems that Pasig and Las Piñas still have plenty of untitled properties with only tax declarations as proof of ownership. Tanay, Rizal is also a candidate pilot area because most of the lands there are untitled. But the program got a big push in Cebu with a very cooperative LGU.

Although most of Cebu is titled (one of the first in the country to have cadastral proceedings), there are pockets of untitled but occupied public property, such as lands in Barangay Tinago and San Roque, which could yield as many as 2,000 titles. There is some initial success in Cebu City where an office had been established with a very competent team, composed of land specialist lawyers and a geodetic engineer.

But all the work in titling land will be for naught unless the integrity of our Torrens Title system is upheld by our national officials. We cannot have a parallel LRA producing authentic looking copies of land titles out of some second hand bookstores of Claro M Recto Avenue.

Customs and media

Over at Twitter last Friday evening, newly designated Customs Chief Ruffy Biazon was agonizing about what to do with the multitude of media folks covering Customs. Somebody said there are amazingly, 400 media representatives covering Customs. There are at least four tabloids that publish weekly covering only Customs.

Isn’t it obvious that most of those people claiming to represent media are anything but? Those from legitimate media in the Twitter discussion advised the new Customs Chief to meet with the publishers of the leading dailies and the owners of the leading networks. He should ask them to make sure their reporters covering Customs don’t become part of the corruption problem by moonlighting as fixers.

Then, the new Customs Chief should go ahead and ignore everyone else pretending to be reporters or even publishers. Biazon should not be afraid of these people even if they threaten him with nasty write-ups. Those noisy tabloids have no circulation worth their threats anyway. Throw the book at them if they try to fix anything. So long as he has nothing to hide, he shouldn’t be afraid of anyone, even those claiming to represent media.

The only reason why past Customs officials tolerated this outsized number of reporters supposedly covering Customs is because they most likely have something to hide. If Biazon keeps his nose clean, is transparent and makes himself accessible on social media, he should not be afraid of this 400 strong “press” group.

It just makes one wonder why, if there are indeed that many reporters covering Customs, why 2,000 containers could disappear without anyone knowing. Did they get scooped by smugglers while sleeping on the job? Or worse?

Cleaning up Customs is everyone’s business… specially media’s. If anyone claiming to represent media becomes part of the problem, he or she should be exposed and made to suffer the consequences. I am sure legitimate publishers and network owners will not tolerate wrong doing by their people.

Chinese and Jews

Ever wonder who is the shrewder businessman? Dr. Ernie E gives us an answer.

A Chinese guy goes to a Jew to buy black bras, size 38. The Jew, known for his business skills, says black bras are rare and he is finding it difficult to source them. Therefore, he has to charge the Chinese guy $50 each.

The Chinese guy buys 25 pairs. He returns a few days later and orders 50. The Jew said it was getting even harder to get so he charges the Chinese $60 each.

The Chinese guy returns a month later and buys the Jew’s remaining stock of 50 and this time, paid $75 each.

The Jew was somewhat puzzled by the large demand for black bras size 38 so he asks the Chinese guy “please tell me… what do you do with all those big black bras?”

“Oh,” the Chinese guy said, “I cut them in half and sell them to Jews as skull caps for $200 each.”

Boo Chanco’s e-mail address is bchanco@gmail.com. He is also on Twitter @boochanco

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About Me

FEF is a public advocacy organization dedicated to advancing the cause of economic and political liberty, good governance, secure and well-defined property rights, and market oriented reforms. It counts among its members former and present Cabinet secretaries and undersecretaries, leading figures in the academe, respected media personalities and opinion makers, and prominent members in the business and finance community.